Warren, Oak Park business owner questions timing of criminal charges

Maher Waad stands in the parking lot of his car-rental business on Eight Mile Road in Oak Park, which, along with his Warren collision shop, Hazel Park rental lot and Shelby Township home, were raided by police in April.
RAY SKOWRONEK--THE MACOMB DAILY

Marks One Collision in Warren was among the locations raided by police.
RAY SKOWRONEK--THE MACOMB DAILY

The owner of a Warren collision shop charged with criminal wrongdoing questions the timing of the charges and a raid of his businesses.

Maher Waad, 29, of Shelby Township, who also owns an Oak Park car rental company, faces charges of racketering and false pretenses, accused of defrauding insurance companies by under-repairing vehicles or scrimping on auto repairs at Marks One Collision in Warren from April 2012 to June 2013. He and his attorney point out the charges came shortly after he after he filed a federal lawsuit against insurance companies.

Macomb prosecutors allege the cost of the actual repairs fell significantly below the insurance payout, thereby saving Mark’s One hundreds or even a few thousand dollars in each instance.

A preliminary examination began Thursday in front of Judge Dean Ausilio in 37th District Court in Warren and is scheduled to continue July 29.

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Waad and his attorney, Steven Haney, contend the investigation was conducted by the Macomb Auto Theft Squad in possible retaliation for Waad and his businesses suing Farmers Insurance Exchange and several other insurance companies for steering customers away from his shop for insurance work, defamation and engaging in ethnic bias, demonstrated by ethnic slurs made by insurance representatives.

The insurance companies help fund the auto theft unit.

“The timing is awfully coincidental,” Haney said. “It all has the makings of being a retaliatory act.

“This really crippled my client and nearly bankrupted him.”

Haney believes investigators are also biased against his client because he is a relatively young immigrant from Iraq who is successful and “sophisticated.” Waad came to the U.S. from Iraq many years ago and is a U.S. citizen, Haney stated.

Macomb County attorney John Schapka said Friday that while the claims about county involvement in the case are “interesting,” they are “without any legal or factual merit.”

At the same time a Farmers attorney denied the allegations in court documents he also states Haney had a conflict of interest in a motion in the federal lawsuit to disqualify him from the case. Attorney Ben Jeffers accuses Haney of “switching sides” because, in recent years, he represented Farmers Insurance in a case involving Marks One, including an investigation of an arson fire at the business that resulted in an substantial insurance payout to Waad’s business.

The federal lawsuit was originally filed in November 2013, and allegations involving MATS were added in an amended complaint filed last January. The next month, MATS filed paperwork to pursue the case, Haney said.

Court fight follows raid

Haney alleges the suspected retaliation reached its peak last April 23 when Marks One Collision on Eight Mile Road in Warren, and Marks One Car Rental stores on Eight Mile in Oak Park and Dequindre Road Hazel Park, along with his Shelby Township home, were raided by MATS and the county Select Enforcement Team. Haney called the raid “military style” in which surveillance cameras were broken and employees handcuffed. Police seized 66 vehicles, over $100,000 in cash, checks, equipment and many boxes of business documents.

No charges resulted from the raids on the rental car businesses.

Haney said Assistant Macomb County Prosecutor Mike Macherzak and others “were led down a path” by the insurance company and MATS pursued trumped up charges that are part of a mere civil dispute. Farmers employees, the complaint says, were “directly communicating” with MATS officials “as a means of attempting to deflect and cover up their racist and tortious conduct.”

“I’ve never seen charges come from a billing dispute,” said Haney, who for two years was the lead attorney for the state auto theft unit in the Michigan Attorney General’s office. “This is not a criminal case.”

Operating a criminal enterprise, aka racketeering, is punishable by up to 20 years. Each of six counts of false pretenses between $1,000 and $20,000 is punishable by up to five years in prison, and two misdemeanor counts of false pretenses between $200 and $1,000 carry a maximum term of one year in jail.

A question of race?

The car rental shop on Eight Mile is the central site of a relatively large-scale car rental company that caters to primarily low-income, African American and Arab American customers, Haney says.

Haney also complained that prosecutors dragged their feet in returning the vehicles and other items, costing him business and forcing him to pay about $25,000 in impound and other fees to get the cars back. Thirty-five of the cars were held for 49 days.

Some of the seized items, several boxes of business documents and about $15,000 in cash and checks had not been returned by Friday, Haney said, after a Thursday deadline. Ausilio scheduled a hearing for Monday to be held if all the items are not returned.

Meanwhile, in the federal lawsuit, Waad claims that two adjusters for Farmers or its subsidiary, Bristol West Insurance Co., on May 22, 2012, during a visit to the Warren shop referred to Waad as a “stupid Arab” and “sand n-----,” the complaint says. One employee “tried to engage Mr. Waad in a physical altercation and threatened ‘to get him.’”

Two days later, when Marks One contacted the director of claims for Farmers or Bristol to complain, the director also used the term “sand n-----,” as well as “a crook,” in reference to Waad, according to the complaint. That employee, the lawsuit says, was fired a short time later.

But the two adjusters and a third employee, an investigator who also made ethnic slurs, have not been fired, the complaint says. The employees “continue to engage in overt acts of vengeful and racially motivated intimidation and tortious interference with plaintiff,” according to the lawsuit.

Haney says Marks One was removed by Farmers and other insurance companies as a “direct bill” repair shop, thereby reducing its ability to help its customers resolve repairs bills resulting from auto accidents that result in insurance claims.

Farmers or Bristol representatives also falsely told Mark’s One customers Waad was under criminal investigation and committed forgery, designed to take away business from Waad and his companies, according to the complaint.

The defendants “undertook these actions to disrupt, and did disrupt, plaintiff’s ongoing and potential business relationships with its customer base and cause irreparable harm to plaintiff’s business reputation,” the lawsuit says.

The defendants also removed Marks One from its “direct repair program,” which cost the Marks One business but also had the effect of freeing the business from requirements that led to the criminal charges, Haney said. Because the collision shop was not in the program, it was not required to repair vehicles at the order of the insurance company.

“If I own a car that needs to be repaired, I, as the property owner, can have it fixed how and by who I want it fixed,” he said. “The insurance company does not have the right to tell the property owner how to fix their car.”

A vehicle owner can have the repair shop provide an alternate repair that is cheaper than the repair approved by the insurance company and pocket the difference, or receive no repair and pocket the entire claim payout, he said.

Farmers denies the allegations in court documents.

Unfair advantage for attorney?

Regarding Farmers’ effort to disqualify Hanney, Jeffers says Haney gained “confidential information” about Farmers and has a conflict of interest.

“We reasonably surmise that it was Mr. Haney’s work for Farmers against plaintiffs that may have led to their interest in hiring him,” Jeffers says. “There is serious risk that Mr. Haney will use Farmer’s confidential information … to Farmers’ detriment in this lawsuit.”

Haney worked from 2009 to 2011 for the law firm Foster Swift, which during that time was retained by Farmers. Haney in 2009 helped investigate the arson fire and worked with an investigator named as one who made racial comments about Waad. Marks One received “a substantial sum of money” for the fire claim.

In a published report about the lawsuit, Waad said the roots of Farmers’ unfair treatment of him can be traced back to collecting the fire claim.

Haney also worked on Farmers’ matters five times in 2013 while employed by Kopka, Pinkus, Dolin & Eads.

About the Author

My beat is the courts of Macomb County and general assignment.
Read more of Jameson Cook's court coverage on his blog http://courthousedish.blogspot.com/ Reach the author at jamie.cook@macombdaily.com
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